On August 6, 2020 Insmed Incorporated (Nasdaq:INSM), a global biopharmaceutical company on a mission to transform the lives of patients with serious and rare disease reported financial results for the second quarter ended June 30, 2020, and provided a business update (Press release, Insmed, AUG 6, 2020, View Source [SID1234563134]).
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"I am incredibly proud of the Insmed team’s performance in the second quarter of 2020, which saw significant progress across our programs even against the backdrop of the continued COVID-19 pandemic," commented Will Lewis, Chair and Chief Executive Officer of Insmed. "ARIKAYCE U.S. sales showed strong sequential growth from the first quarter as we continued to support patients and physicians through both virtual and in-person efforts, and we are excited about its inclusion in the new international treatment guidelines as well as the recent positive CHMP opinion. At the same time, we continued to advance brensocatib, which we believe offers a significant opportunity to address unmet needs in bronchiectasis and other neutrophil-driven diseases, along with our earlier-stage clinical pipeline."
Second Quarter 2020 Financial Results
·Total revenue for the second quarter ended June 30, 2020, was $42.5 million, comprising U.S. net sales of $41.0 million and ex-U.S. net sales of $1.5 million. This compares to total revenue of $30.0 million for the second quarter of 2019.
·Cost of product revenues (excluding amortization of intangible assets) was $10.0 million for the second quarter of 2020, compared to $4.9 million for the second quarter of 2019.
·Research and development (R&D) expenses were $35.7 million for the second quarter of 2020, compared to $33.5 million for the second quarter of 2019.
·Selling, general, and administrative (SG&A) expenses for the second quarter of 2020 were $49.7 million, compared to $52.4 million for the second quarter of 2019.
For the second quarter of 2020, Insmed reported a GAAP net loss of $61.9 million, or $0.64 per share, compared to a GAAP net loss of $66.5 million, or $0.81 per share, for the second quarter of 2019.
·During the second quarter of 2020, Insmed completed a public offering of 11,155,000 shares of common stock, including 1,455,000 shares issued pursuant to the exercise in full of the underwriters’ option to purchase additional shares, that resulted in net cash proceeds of $245.9 million, after deducting underwriting discounts and other offering-related expenses.
Recent Corporate Developments & Program Highlights
Brensocatib Advancement
Insmed presented final results from the Phase 2 WILLOW study of brensocatib in patients with non-cystic fibrosis bronchiectasis (NCFBE) during a virtual session of the American Thoracic society in June 2020. Also in June, Insmed received Breakthrough Therapy Designation from the U.S. Food and Drug Administration (FDA) for brensocatib for the treatment of adult patients with NCFBE for reducing exacerbations. The Company remains on track to initiate its planned Phase 3 program with brensocatib in patients with bronchiectasis by the end of 2020.
ARIKAYCE Global Advancement
In July 2020, Insmed received a positive opinion from the Committee for Medicinal Products for Human Use (CHMP) recommending ARIKAYCE Liposomal 590 mg Nebuliser Dispersion for the treatment of nontuberculous mycobacterial (NTM) lung infections caused by Mycobacterium avium complex (MAC) in non-CF patients with limited treatment options. Pending approval of the marketing authorization application by the European Commission (EC), the Company anticipates a potential launch in Germany by the end of 2020, followed shortly thereafter by the UK.
Insmed has also submitted a new drug application for ARIKAYCE to Japan’s Ministry of Health, Labour and Welfare (MHLW) for the treatment of patients with NTM lung disease caused by MAC who did not sufficiently respond to prior treatment. In June 2020, a Japanese Medical Device Notification (JMDN) was submitted to the MHLW for Lamira, the designated device for administration of ARIKAYCE. The JMDN was accepted and Lamira is authorized for use in Japan.
New International NTM Treatment Guidelines
In July 2020, the American Thoracic Society, European Respiratory Society, European Society of Clinical Microbiology and Infectious Diseases, and Infectious Diseases Society of America issued new treatment guidelines for the management of NTM lung disease. The guidelines strongly recommend the addition of ARIKAYCE to the standard treatment regimen for patients with MAC lung disease who have failed to convert to a negative sputum culture after at least six months of treatment.
ARIKAYCE Label Expansion
Insmed continues to advance the post-approval confirmatory clinical trial for ARIKAYCE in a front-line setting of patients with MAC lung disease as well as the development of an appropriate patient reported outcome (PRO) tool that will enable the assessment of ARIKAYCE for the treatment of NTM lung disease. Insmed plans to initiate both the confirmatory study and a study to validate the PRO by the end of 2020 and to run these studies in parallel, pending alignment with the FDA.
Treprostinil Palmitil Advancement
Insmed is advancing treprostinil palmitil, a dry powder, inhaled treprostinil prodrug formulation, for the potential treatment of pulmonary arterial hypertension and plans to initiate a Phase 1 study by the end of 2020.
Balance Sheet
As of June 30, 2020, Insmed had cash and cash equivalents of $641.9 million. The Company’s total operating expenses for the second quarter of 2020 were $86.7 million. Adjusted operating expenses, as defined below, for the second quarter of 2020 were $73.7 million.
The Company plans to continue investing in the following key activities in 2020:
(i)U.S. commercialization of ARIKAYCE;
(ii)clinical trial activities, including (a) the development of a PRO for NTM lung disease, the initiation of a study to validate the PRO and, in parallel, a confirmatory clinical study of ARIKAYCE, (b) the advancement of brensocatib into a Phase 3 program in patients with bronchiectasis, and (c) the advancement of treprostinil palmitil; and
(iii)expansion in Japan and Europe to support pre-commercial activities for ARIKAYCE in those regions and, pending approval of the marketing authorization application by the EC, launch activities in initial European countries.
Conference Call
Insmed will host a conference call beginning today at 8:30 AM Eastern Time. Shareholders and other interested parties may participate in the conference call by dialing (888) 317-6003 (domestic) or (412) 317-6061 (international) and referencing conference ID number 9359069. The call will also be webcast live on the company’s website at www.insmed.com.
A replay of the conference call will be accessible approximately one hour after its completion through August 20, 2020 by dialing (877) 344-7529 (domestic) or (412) 317-0088 (international) and referencing replay access code 10146257. A webcast of the call will also be archived for 90 days under the Investor Relations section of the company’s website at www.insmed.com.
Non-GAAP Financial Measures
In addition to the U.S. generally accepted accounting principles (GAAP) results, this earnings release includes adjusted operating expenses, a non-GAAP financial measure, which Insmed defines as total operating expenses less stock-based compensation expense, depreciation, amortization of intangibles and certain milestones related to ARIKAYCE, which are payable under our amended agreements with Cystic Fibrosis Foundation Therapeutics, Inc. (CFFT). A reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure is presented in the table attached to this press release.
Management believes that this non-GAAP financial measure is useful to both management and investors in analyzing our ongoing business and operating performance. Management believes that providing this non-GAAP information to investors, in addition to the GAAP results, allows investors to view our financial results in the way that management views financial results. Management does not intend the presentation of this non-GAAP financial measure to be considered in isolation or as a substitute for results prepared in accordance with GAAP. In addition, this non-GAAP financial measure may differ from similarly named measures used by other companies.
About ARIKAYCE (amikacin liposome inhalation suspension)
ARIKAYCE is the first and only FDA-approved therapy indicated for the treatment of Mycobacterium avium complex (MAC) lung disease as part of a combination antibacterial drug regimen for adult patients with limited or no alternative treatment options. Current international treatment guidelines recommend the use of ARIKAYCE in combination with a multidrug regimen in patients with MAC lung disease who have failed standard therapy after at least six months of treatment. ARIKAYCE is a novel, inhaled, once-daily formulation of amikacin, an established antibiotic that was historically administered intravenously and associated with severe toxicity to hearing, balance, and kidney function. Insmed’s proprietary PULMOVANCE liposomal technology enables the delivery of amikacin directly to the lungs, where liposomal amikacin is taken up by lung macrophages where the infection resides, while limiting systemic exposure. ARIKAYCE is administered once daily using the Lamira Nebulizer System manufactured by PARI Pharma GmbH (PARI).
About PARI Pharma and the Lamira Nebulizer System
ARIKAYCE (amikacin liposome inhalation suspension) is delivered by a novel inhalation device, the Lamira Nebulizer System, developed by PARI. Lamira is a quiet, portable nebulizer that enables efficient aerosolization of liquid medications, including liposomal formulations such as ARIKAYCE, via a vibrating, perforated membrane. Based on PARI’s 100-year history working with aerosols, PARI is dedicated to advancing inhalation therapies by developing innovative delivery platforms and new pharmaceutical formulations that work together to improve patient care.
About Brensocatib
Brensocatib is a small molecule, oral, reversible inhibitor of dipeptidyl peptidase I (DPP1) being developed by Insmed for the treatment of patients with bronchiectasis. DPP1 is an enzyme responsible for activating neutrophil serine proteases (NSPs), such as neutrophil elastase, in neutrophils when they are formed in the bone marrow. Neutrophils are the most common type of white blood cell and play an essential role in pathogen destruction and inflammatory mediation. In chronic inflammatory lung diseases, neutrophils accumulate in the airways and result in excessive active NSPs that cause lung destruction and inflammation. Brensocatib may decrease the damaging effects of inflammatory diseases such as bronchiectasis by inhibiting DPP1 and its activation of NSPs.
Hypersensitivity Pneumonitis has been reported with the use of ARIKAYCE in the clinical trials. Hypersensitivity pneumonitis (reported as allergic alveolitis, pneumonitis, interstitial lung disease, allergic reaction to ARIKAYCE) was reported at a higher frequency in patients treated with ARIKAYCE plus background regimen (3.1%) compared to patients treated with a background regimen alone (0%). Most patients with hypersensitivity pneumonitis discontinued treatment with ARIKAYCE and received treatment with corticosteroids. If hypersensitivity pneumonitis occurs, discontinue ARIKAYCE and manage patients as medically appropriate.
U.S. INDICATION
LIMITED POPULATION: ARIKAYCEÒ is indicated in adults, who have limited or no alternative treatment options, for the treatment of Mycobacterium avium complex (MAC) lung disease as part of a combination antibacterial drug regimen in patients who do not achieve negative sputum cultures after a minimum of 6 consecutive months of a multidrug background regimen therapy. As only limited clinical safety and effectiveness data for ARIKAYCE are currently available, reserve ARIKAYCE for use in adults who have limited or no alternative treatment options. This drug is indicated for use in a limited and specific population of patients.
This indication is approved under accelerated approval based on achieving sputum culture conversion (defined as 3 consecutive negative monthly sputum cultures) by Month 6. Clinical benefit has not yet been established. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials.
Limitation of Use: ARIKAYCE has only been studied in patients with refractory MAC lung disease defined as patients who did not achieve negative sputum cultures after a minimum of 6 consecutive months of a multidrug background regimen therapy. The use of ARIKAYCE is not recommended for patients with non-refractory MAC lung disease.
Patients are encouraged to report negative side effects of prescription drugs to the FDA. Visit www.fda.gov/medwatch, or call 1-800-FDA-1088. You can also call the Company at 1-844-4-INSMED.
Hemoptysis has been reported with the use of ARIKAYCE in the clinical trials. Hemoptysis was reported at a higher frequency in patients treated with ARIKAYCE plus background regimen (17.9%) compared to patients treated with a background regimen alone (12.5%). If hemoptysis occurs, manage patients as medically appropriate.
Bronchospasm has been reported with the use of ARIKAYCE in the clinical trials. Bronchospasm (reported as asthma, bronchial hyperreactivity, bronchospasm, dyspnea, dyspnea exertional, prolonged expiration, throat tightness, wheezing) was reported at a higher frequency in patients treated with ARIKAYCE plus background regimen (28.7%) compared to patients treated with a background regimen alone (10.7%). If bronchospasm occurs during the use of ARIKAYCE, treat patients as medically appropriate.
Exacerbations of underlying pulmonary disease has been reported with the use of ARIKAYCE in the clinical trials. Exacerbations of underlying pulmonary disease (reported as chronic obstructive pulmonary disease (COPD), infective exacerbation of COPD, infective exacerbation of bronchiectasis) have been reported at a higher frequency in patients treated with ARIKAYCE plus background regimen (14.8%) compared to patients treated with background regimen alone (9.8%). If exacerbations of underlying pulmonary disease occur during the use of ARIKAYCE, treat patients as medically appropriate.
Anaphylaxis and Hypersensitivity Reactions: Serious and potentially life-threatening hypersensitivity reactions, including anaphylaxis, have been reported in patients taking ARIKAYCE. Signs and symptoms include acute onset of skin and mucosal tissue hypersensitivity reactions (hives, itching, flushing, swollen lips/tongue/uvula), respiratory difficulty (shortness of breath, wheezing, stridor, cough), gastrointestinal symptoms (nausea, vomiting, diarrhea, crampy abdominal pain), and cardiovascular signs and symptoms of anaphylaxis (tachycardia, low blood pressure, syncope, incontinence, dizziness). Before therapy with ARIKAYCE is instituted, evaluate for previous hypersensitivity reactions to aminoglycosides. If anaphylaxis or a hypersensitivity reaction occurs, discontinue ARIKAYCE and institute appropriate supportive measures.
Ototoxicity has been reported with the use of ARIKAYCE in the clinical trials. Ototoxicity (including deafness, dizziness, presyncope, tinnitus, and vertigo) were reported with a higher frequency in patients treated with ARIKAYCE plus background regimen (17%) compared to patients treated with background regimen alone (9.8%). This was primarily driven by tinnitus (7.6% in ARIKAYCE plus background regimen vs 0.9% in the background regimen alone arm) and dizziness (6.3% in ARIKAYCE plus background regimen vs 2.7% in the background regimen alone arm). Closely monitor patients with known or suspected auditory or vestibular dysfunction during treatment with ARIKAYCE. If ototoxicity occurs, manage patients as medically appropriate, including potentially discontinuing ARIKAYCE.
Nephrotoxicity was observed during the clinical trials of ARIKAYCE in patients with MAC lung disease but not at a higher frequency than background regimen alone. Nephrotoxicity has been associated with the aminoglycosides. Close monitoring of patients with known or suspected renal dysfunction may be needed when prescribing ARIKAYCE.
Neuromuscular Blockade: Patients with neuromuscular disorders were not enrolled in ARIKAYCE clinical trials. Patients with known or suspected neuromuscular disorders, such as myasthenia gravis, should be closely monitored since aminoglycosides may aggravate muscle weakness by blocking the release of acetylcholine at neuromuscular junctions.
Embryo-Fetal Toxicity: Aminoglycosides can cause fetal harm when administered to a pregnant woman. Aminoglycosides, including ARIKAYCE, may be associated with total, irreversible, bilateral congenital deafness in pediatric patients exposed in utero. Patients who use ARIKAYCE during pregnancy, or become pregnant while taking ARIKAYCE should be apprised of the potential hazard to the fetus.
Most Common Adverse Reactions: The most common adverse reactions in Trial 1 at an incidence ≥5% for patients using ARIKAYCE plus background regimen compared to patients treated with background regimen alone were dysphonia (47% vs 1%), cough (39% vs 17%), bronchospasm (29% vs 11%), hemoptysis (18% vs 13%), ototoxicity (17% vs 10%), upper airway irritation (17% vs 2%), musculoskeletal pain (17% vs 8%), fatigue and asthenia (16% vs 10%), exacerbation of underlying pulmonary disease (15% vs 10%), diarrhea (13% vs 5%), nausea (12% vs 4%), pneumonia (10% vs 8%), headache (10% vs 5%), pyrexia (7% vs 5%), vomiting (7% vs 4%), rash (6% vs 2%), decreased weight (6% vs 1%), change in sputum (5% vs 1%), and chest discomfort (5% vs 3%).
Drug Interactions: Avoid concomitant use of ARIKAYCE with medications associated with neurotoxicity, nephrotoxicity, and ototoxicity. Some diuretics can enhance aminoglycoside toxicity by altering aminoglycoside concentrations in serum and tissue. Avoid concomitant use of ARIKAYCE with ethacrynic acid, furosemide, urea, or intravenous mannitol.
Overdosage: Adverse reactions specifically associated with overdose of ARIKAYCE have not been identified. Acute toxicity should be treated with immediate withdrawal of ARIKAYCE, and baseline tests of renal function should be undertaken. Hemodialysis may be helpful in removing amikacin from the body. In all cases of suspected overdosage, physicians should contact the Regional Poison Control Center for information about effective treatment.